New to parenting? Here’s how to get started on your life insurance policy

Key takeaways

• Life insurance can help protect your family’s financial future.
• New parents should review coverage early.
• Term life insurance is often a practical starting point.
• The right coverage depends on your income, debts and family needs.
• A few simple steps can make the buying process easier.

Bringing home a newborn involves so many firsts for that tiny bundle of joy from the first smile to the first time you finally get a full night of sleep.

On the other side of the coin, it’s also the first time most new parents find themselves completely responsible for the safety, well-being and happiness of another human being. This is the time they also begin to recognize the need to ensure their loved ones will be protected if the unexpected strikes.

That’s where life insurance comes in. While the process of obtaining coverage can sometimes feel daunting, it’s much easier than you’d think.

Why life insurance is essential for new parents

Life insurance is essential for new parents because it can help provide financial protection when a growing family depends on your income and support. From everyday expenses to long-term goals like childcare, housing and education, the right coverage can help ease the burden if the unexpected happens. 

Your step-by-step checklist for securing your family’s future

1. Start early by getting familiar with the vocabulary of life insurance.

When you begin looking into life insurance policies, you’ll hear a lot of industry jargon coming your way. In order to understand what you’re purchasing, take some time to familiarize yourself with these important insurance terms:

Term life insurance: Often less expensive than permanent life insurance, term life provides protection for a specific term or period of time, such as 15 or 20 years.

Permanent life insurance: Also referred to as “perm life” or “whole life,” this insurance lasts throughout your lifetime and pays a benefit upon your death.

Beneficiary: This is the person to whom your insurance benefits are paid upon your death.

Premium: The premium is the payment you make on a regular basis—monthly, quarterly, biannually or annually - to the life insurance  company to pay for your insurance policy.

2. Determine the amount of coverage you’ll need. 

To figure out your coverage needs, add up your financial obligations like mortgage, education for children, car payment etc. From there, subtract the amount of your liquid assets like cash, bonds, investments or any items that could be used to pay for your financial obligations upon your death. The difference between these two numbers is a good estimate of the amount of life insurance coverage you’ll need.

If you don’t want to spend time calculating all your financial obligations for years to come, a common rule of thumb is to purchase life insurance that is roughly 10 times your annual income. (If you plan to pay for your children’s education, it’s a good idea to add about $100,000 per child for college expenses.)

For more tips and information, check out these sample scenarios for buying life insurance.

3. Get a life insurance quote.

Getting a free quote is easy. Talk to one of our professionals so we can get to know you and identify your unique needs. We’ll help you understand the type of coverage that may fit your situation, how much protection to consider and what steps come next. It’s a simple way to start making informed decisions for your family’s future.

4. Gather your documents.

Sometimes the most challenging part of purchasing life insurance is tracking down the paperwork buried in drawers throughout the house. Be patient with yourself, especially if you’re a new parent.

Devote small blocks of time to tracking down the required documentation. Even as little as 30 minutes a week can help you make solid progress.

Here are the documents you’ll need:

5. Get a medical examination.

Make an appointment with the medical provider specified by your insurance agent. When it’s time for your appointment, be prepared to step on the scales, provide a urine sample and undergo blood work. You may also need to wait for the medical provider to complete paperwork and provide the results of your exam to be sent to your life insurance company.
 

6. Wait for the underwriting approval.

After you’ve selected a policy and completed all the paperwork and medical exam, the next step is to wait for underwriting approval. Behind the scenes, an underwriter calculates your risk. This process can take up to six to eight weeks, so it’s better to do this sooner rather than later.
 

7. Update your financial advisor.

Your life insurance policy can be an important part of your wealth plan, so be sure your financial advisor is informed about your policy. He or she will need to know what type of policy you’ve purchased as well as your designated beneficiaries. They'll take that information into account in creating and revising your ongoing financial plans.

Conclusion

Becoming a parent changes everything, and life insurance can be an important step in helping protect your family’s future. By taking time to understand your options now, you can make a thoughtful decision that supports your loved ones if the unexpected happens.

Ready to take the next step? Talk to a John Hancock professional today to get started with a life insurance quote for your growing family.

Disclaimer:

The information in this article is for educational purposes only and is not intended to provide legal, tax, or financial advice. For guidance on your individual situation, please consult a qualified professional.

Insurance policies and/or associated riders and features may not be available in all states.

Insurance products are issued by: John Hancock Life Insurance Company (U.S.A.), Boston, MA 02116(not licensed in New York) and John Hancock Life Insurance Company of New York, Valhalla, NY 10595.

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